Retail makes dramatic resurgence on Fifth and Madison Avenues in NYC

Retailers began taking big bites of prime real estate in The Big Apple in 2024.

At the beginning of 2023, retail space availability on Madison Avenue was at 16%. Today it is below 6%. On lower Fifth Avenue in last year’s first quarter, 24% of retail space was open for leasing. By the end of Q1 2024, availability there had dropped by almost 10 points to 14.5%.

That’s according to JLL’s first quarter New York Retail report, which points out that much of that space has been swallowed up by luxury retailers including Gucci, Rolex, and Louis Vuiton. The average prime availability rate for the first quarter was 15.4%, well below the rate of 21% in 2019 and peak availability of 28% in 2021. 

Average prime submarkets saw a year-over-year decrease in availability rates of 2.3% and a quarter-over-quarter decrease of 0.5%. Availability rates for the first quarter differed by submarket. Madison Avenue’s decline was a record low, and lower Fifth Avenue’s was close to 2019’s record low of 12.9%.

Not all luxury landings in Manhattan fared as well, however. The Meatpacking District’s rate rose to 30.6% availability rate in the first quarter, up considerably from the 24.1% it posted in the first quarter of 2023.

Average asking rent per square foot has increased with decreased availability, but is still far from pre-COVID highs. In the first quarter of 2024, unweighted average asking rent was $537 per sq. ft., compared to $495 in the first quarter of 2022. Average prime asking rents decreased slightly from $544 in the first quarter of 2023 and $545 in the fourth quarter of 2023.

Most submarkets saw a slight year-over-year decrease in average asking rents. Herald Square saw a more dramatic decrease than others from $532 in the first quarter of 2023 to $485 in the most recent quarter. Two submarkets, Upper Fifth Ave. (+4.9%) and Times Square (+23.8%), saw a year-over-year increase in average asking rents. 

JLL provided a list of significant retail signings in the first quarter of the year, broken down by neighborhood, borough, and square footage:

• Wegmans (Upper West Side, 58,874 sq. ft.)
• Bedford Stuyvesant Beginnings Charter (Williamsburg, Brooklyn, 51,498 sq. ft.)
• L’Oreal (Hudson Yards, 45,863 sq. ft.)
• Food Hall (Midtown, 34,822 sq. ft.)
• Museum of Mathematics (NoMad, 25,158 sq. ft.)
• Del Frisco’s Double Eagle Steakhouse (Rock Center, 25,246 sq. ft.)
• GU (SoHo, 25,000) sq. ft.)
• Fitness Factory (Harlem, 22,407 sq. ft.)
• Urban Outfitters (SoHo, 20,816 sq. ft.)
• Avra Steak (34th St., 20,000 sq. ft.)
• AdvantageCare Physicians - EmblemHealth (Flatiron, 18,390 sq. ft.)
• BioLife Plasma Services (Harlem, 16,698 sq. ft.)
• Rooftop Hospitality Group (Near Penn Station, 15,000 sq. ft.)
• Arc’teryx (Lower Fifth Ave., 12,689) sq. ft.)
• GUI Korean Steakhouse (Midtown West, 10,202 sq. ft.)

JLL’s more than 550 global research professionals track and analyze economic and property trends and forecast future conditions in over 60 countries.